Will Buhari’s announcement of ministers revive the Nigerian equity market?

Prior to the February 2019 general election, analysts positioned that the performance of the Nigerian equity market post-election is largely dependent on whoever wins the presidential poll. They maintained that the domestic bourse might rally if incumbent and All Progressive Congress (APC) candidate, Muhammadu Buhari wins, and would rally more if the former vice president and presidential candidate of the People’s Democratic Party (PDP) Atiku Abubakar emerge victorious because his policies were perceived marketoriented and investor-friendly.

Since the former military leader was reelected for a final four-year term, the Nigerian equity market continues to bleed over policy uncertainty, growth challenge and dwindling profit margin of listed companies. Many posited that the delay of the former military leader to swiftly constitute cabinet also contributed to dampened investor sentiment.

But now that Buhari’s ministerial nominees are being confirmed by the Nigerian

mance either way.

Ologbon-ori Taiwo, Lead Research Analyst at Cashcraft Capital

Market friendly policies are part of the factors that drive bargain appetite towards investment in equities, not cabinet really. Once economic policies are good and the economy is responding, the market would react.

Cabinets are just to implement government policies. If you have the best brain in your cabinet without market-friendly policies, the market would not move. A cursory view of newly announced ministers revealed nothing spectacular but pure politics. Meaning that there would be continuity of old policies.

Chukwuemeka Nwagwu, Analyst at Axe Capital Limited

Investor confidence is very low in the market right now and that is the cause of the wide disparity. Some analysts will say when the President appoints his minister the market will push up but I do not see any significant change in the current trend even if ministers are appointed.

It is only when the Federal Government are able to initiate policies that investors consider business friendly that the market can move or otherwise reduce the rates and frequency of fixed income instruments issued.